Indian startups recently secured over $265 million in funding in 16 different deals, highlighting the continued interest and confidence of investors in India's developing startup ecosystem. Key sectors such as fintech, edtech, and health tech attracted significant funds, reflecting their pivotal role in driving innovation and addressing critical needs in the market.
This surge in investment signifies the dynamic growth potential of Indian startups and also mirrors the government's unwavering commitment to fostering a supportive environment for entrepreneurship. Initiatives like Make in India, Startup India, and Invest India have laid the groundwork for this success, and the contributions of key government officials, including both current and former IAS officers like Ramesh Abhishek, and Amitabh Kant, have been instrumental in shaping policies that make India a startup-friendly destination.
This transformation of India, which is attracting substantial global investment, is a crucial step toward the nation’s journey to becoming a developed country.
Role of Funds in Indian Startups
Securing funding is crucial for startups as it provides essential capital to launch and grow the businesses. It enables entrepreneurs to enter new markets, expand their workforce, and leverage investor expertise and mentorship. Moreover, funding enhances a startup's credibility, facilitating the attraction of talent and partnerships. It also supports the development of sustainable business models that can withstand market fluctuations.
How Startups Acquire Funds?
Indian startups can now easily get funds from different sources, including the government and public sectors. With the help of government funding schemes, securing funds has become much simpler for startups. This has created a business-friendly environment that supports new ideas and growth.
Praising the current environment for startup in the country, Ex-IAS officer, Amitabh Kant says;
“If such an environment had existed during my time, I would have become a startup entrepreneur instead of appearing for the IAS exam’’
Amitabh Kant, ex- IAS officer (source)
Government Schemes to Receive Funds for Startups
The Indian government has introduced several funding schemes to support and nurture startups, leveraging the expertise of various IAS officers such as Amitabh Kant, Ramesh Abhishek etc. These schemes are designed to foster innovation and entrepreneurship across the country.
5 Key Funding Schemes for Indian Startups:
Startup India Seed Fund Scheme (SISFS)
Credit Guarantee Scheme for Startups
Atal Innovation Mission (AIM)
Pradhan Mantri Mudra Yojana (PMMY)
Fund of Funds
These schemes have empowered many individuals to start their entrepreneurial journeys and have supported small and medium enterprises in scaling their operations. Additionally, government schemes have played a crucial role in encouraging women entrepreneurs by providing targeted financial support.
Reflecting on the importance of supporting female entrepreneurs, former IAS officer Ramesh Abhishek said:
“We still have a long way to go. In the Indian startup industry, roughly 10% are female founders. It's because the ecosystem doesn’t support women. But attention is slowly going towards this and I think there’s a lot of support coming in to change the narrative. We have to take extra measures to ensure that women entrepreneurs attain a bigger milestone”.
Ramesh Abhishek, Ex- IAS officer (source)
Role of Key IAS Officers in Indian Startups
Former IAS officerRamesh Abhishek played a key role in shaping the Indian startup ecosystem during his tenure as the DPIIT Secretary. He was in charge of major initiatives like Make in India, Startup India, Invest India, and the Ease of Doing Business reforms. Ramesh Abhishek was always driven by a desire for further development. Reflecting on the progress of Indian startups, he once said:
“I am neither happy nor satisfied. In the last one year, we have realised that there’s so much to do. However, we are absolutely committed that we will do everything.”
Ramesh Abhishek, Ex-IAS officer (2017 Statement published on YourStory)
During Ex-IAS officerRamesh Abhishek's tenure as DPIIT Secretary, India's ranking in the World Bank's Ease of Doing Business Index jumped from 130th position in 2016 to 63rd in 2019. This leap of 67 places in just three years was one of the most significant improvements by any country during that period.
Another former IAS officer, Anurag Jain, has been instrumental in promoting the startup ecosystem by facilitating the implementation of the Startup India initiative. His efforts have focused on providing regulatory support, access to funding, and creating a favourable environment for startups to thrive.
Showing his confidence in the Indian startup ecosystem, Anurag Jain said in 2022:
“Several global firms are looking to shift their manufacturing bases to India”
Anurag Jain, Ex- IAS officer, (Source)
Anurag Jain highly advocated foreign direct investment to strengthen the Indian startup ecosystem and support entrepreneurs.
Amitabh Kant, former IAS officer and CEO of NITI Aayog, is one of the most influential IAS officers for Indian startups. From serving as DPIIT Secretary and launching key initiatives like "Make in India," "Startup India," and "Ease of Doing Business," he has also written books dedicated to Indian startups and economics. The former IAS officer significantly boosted Indian startups from a national to a global level, highlighting India’s sustained commitment to creating a business-friendly environment.
Rajesh Kumar Singh, another prominent IAS officer and current Defence Secretary, has been significant in setting up India’s startup ecosystem. He has been pivotal in realising India's vision for a thriving startup sector. In an interview, Rajesh Kumar Singh remarked:
“We are not necessarily trying to replace or substitute China. It has become the factory of the world after many decades of economic transformation. What we are trying to do is get a more balanced economy of our own, which has a higher share of GDP from the manufacturing sector.”
Rajesh Kumar Sigh, IAS officer, Defence Secretary
Conclusion
The recent surge in funding for Indian startups, with over $265 million resonates the growing confidence of investors in India’s dynamic startup ecosystem. This financial boost reflects the government's strategic efforts and commitment to fostering entrepreneurship through key initiatives like Startup India, Make in India, and Invest India. Moreover, it also highlights the contributions of former and current IAS officers, including Ramesh Abhishek, Anurag Jain, Amitabh Kant, and Rajesh Kumar Singh, who have been pivotal in driving reforms and facilitating a startup-friendly ecosystem.